According to Cathie Wood, the founder and CEO of Ark Investment Management, Ethereum price is set for a bullish trade in the coming months. Wood argues that the crypto coin is extremely undervalued despite its potential for DeFi and NFTs.
Wood is one of the strongest supporters of crypto, particularly Bitcoin. Her company is also widely recognized for its themed exchange-traded funds (ETFs) and bullish market predictions.
This week, Wood explained the crypto coins that her company could benefit from. She emphasized gains that could quadruple in a few years.
Ethereum Value: Why Ether Is Underappreciated
Last month, the popularity of "Ethereum killers" skyrocketed. Investors chose crypto coins like Polygon (Matic), Cardano (ADA), and Solana (SOL) because their systems are newer, faster and cheaper than Ethereum. They even outperformed ETH in market trades on November.
However, Ethereum has an edge unlike any other.
Wood pointed out that Ethereum is still the central blockchain technology. Its system runs the operations for decentralized finance (DeFi) and nonfungible tokens (NFTs), making its existence crucial to many crypto coins. Wood said ETH's potential is being underestimated because of the "new worlds growing on top of it," per Fortune.
For Wood, the Ethereum market is still "in its infancy" stage. It still has "miles to go" to catch up to Bitcoin, which is "primarily a monetary system."
However, it should be emphasized that Wood fully believes in its potential. She said ETH and DeFi would soon "accelerate" in growth and possibly move further beyond Bitcoin.
At the time of writing, Ethereum is trading at $3,951.52 with a 3.8 percent downward growth, per Coin Desk. It is admittedly a sharp drop compared to its earlier peak of $4,440.33 on Thursday. However, it is still possible for a rebound to happen at any moment.
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Ethereum Price Prediction: Big Investments
For Wood, one of the big contributors to Ethereum growth is its digital systems. The concept also applies to Bitcoin. She argued that cryptocurrencies are not trapped in a market bubble. Instead, they are both preparing for a strong recovery.
According to Investing, Ark Investment Management's compound annual rate of expectation has gone up to nearly 40 percent on Friday, which is 25 percent more than their predictions for the market peak in March. This implies that Ark expects its innovation stocks to quadruple from current levels in the next five years.
Wood said, "here we are, ready for primetime, and we got all this fear and uncertainty and doubt. As a portfolio manager, I actually love that backdrop," per Investing.
Mike McGlone of Bloomberg Intelligence also supports Wood's claims. He said the coins are risk assets slowly evolving to digital-reserve assets. He pointed out that since most of the world is being digitalized, this should be a positive implication for future prices.
Note that these predictions are not guarantees for future market performance. Readers are advised to take this information with a pinch of salt.
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